U.S. trails major broadband technology trends

Posted July 16, 2007 - 10:45
by
Wolfgang Gruener

Paris (France) – A new report released by the Organisation for Economic Co-Operation and Development (OECD) highlights the changes and market dynamics in the telecommunications industry within its 30 member countries. The collected data shows that the U.S. currently does not have leadership role in driving or adopting cutting edge broadband technology.

According to the OECD, as of June 2006, about 60% of the 263 million people living in the geographic area covered by the organization, had access to broadband Internet. Reflected on the total population, about 15 out of 100 inhabitants were using fast Internet connections. Broken down to countries, Denmark, The Netherlands, Iceland, Switzerland and Korea are leading the pack, each with a penetration of higher than 25%. The United States is listed on position 13, with a penetration of 18%.

DSL remains the favored broadband access technology. 22 of the OECD member countries offer DSL access to 90% or more of their population, with DSL being available to 100% in Belgium, Korea, Luxembourg The Netherlands and the UK. 79% of people living in the U.S. can subscribe to DSL (which ranks the U.S. at #26), according to the report, while 97% have access to cable-based broadband Internet.

Overall available download speeds in the U.S. are competitive on a world, thanks to Verizon’s FiOS service. The 35 Mbps package places the U.S. third, behind the 100 Mbps services offered in Japan and Korea. Excluding this service, the regular DSL packages (up to 6 Mbps) mostly available in the U.S. put the country at the very end of the group. In cable broadband speeds, the U.S. finishes 23rd on the list: Japan is already at 30 Mbps, Norway at 26 Mbps and Sweden at 24 Mbps: Fastest cable broadband speeds available in the U.S. are 6 Mbps, according to the OECD.

U.S. telecommunications companies have begun increasing their investment in public telecommunications. The OECD study found that U.S. companies spend about $190 per capita per year to improve their services. That puts the U.S. at #7 in this category, behind countries such as Iceland ($310), Norway ($240), the UK ($220) and Australia ($210).

Pricing of available services puts the U.S. in the top 5 of the OECD list. However, there are huge gaps to be considered: While broadband prices for a monthly subscription are offered from $10.79 in Sweden and stretch to $46.74 on the high-end, the U.S. is listed at #4: It isn’t far behind in the entry-level market ($15.93), but runs away on the high-end ($191.20). The most expensive country in terms of broadband is Mexico, according to the OECD: Monthly subscription prices range from $52.36 to $802.65.

The organization also measured broadband prices in terms of Mbps. The cheapest access in this category is found in Japan, where users can access the Internet for as little as $0.22 per Mbps. The U.S. checks in at #13 with prices as low as $3.18 per Mbps for the cheapest available services. The most expensive Mbps service is offered in Turkey, where users have to pay at least $82.13 for ever Mbps.